| From: Selectric II | 9/3/2024 9:14:42 PM | | | | | | It's such a relief and so encouraging to see that within the past couple of weeks, humankind has communally agreed that it has transcended the need for energy, whether generated by oil and gas, coal, nuclear, or otherwise.
We will all just co-exist in harmony with nature, and on nature's terms....
lalalalala |
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| From: ItsAllCyclical | 9/3/2024 9:41:38 PM | | | | | | Listening to LOT CC now. Really surprised it's not doing better. The news release was terrible in terms of conveying info. If you own this it's only 21 min long, must listen.
But I was wrong in my assumptions. Still have more to listen, but this is less than half of the first tranch they plan for forward sales (15 mil in pre-pay, but it's taken as a loan). But they can sell forward 3.5 mil lbs and only be at 30% for expected production till 2030. So CEO expects another offtake agreement and given WNA and seasonality I think he'll be able to get even better terms on the next deal.
By the end of the process they expect to have most of their production locked up for the next 4-5 years with floor/ceilings and base escalations - we'll see what that means.
But the end result is the CEO is confident that he can raise the money to get into production w/these agreements. I don't think the shorts are going to see the dilution that they expect.
But they may not figure that out for a while. More firepower down the road, short away. CEO is getting it done in my opinion.
LOT is currently 4.4% of holdings so I can afford to wait. If they secure a 2nd agreement on better terms at some pt I could see increasing the position by 50%+. This one has a lot of torque given their resource in Botsw (#2 juristiction in Africa, probably behind Namibia) and first moving advantage getting into production before most of their peers (not there yet, but far more likely after proving these forward sale agreements w/pre-pay can work). |
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| To: ItsAllCyclical who wrote (27895) | 9/3/2024 10:02:48 PM | | From: ItsAllCyclical | | | | LOT - Continued
From the CC if you do the math and look at how much they raised w/this forward sale (early pre-pay deal), and then apply to their remaining production from 2026 to 2030, I get 120 mil raised. My math could be off, but it looks pretty simple. New deals should be done on better terms as well. So I can see where the CEO has confidence that they can make into production mostly, if not all doing similar deals.
I don't think the shorts are going to get their expected dilution anytime soon. Some of this was probably related to Global Atomic (but shouldn't be) and some of course is sector wide.
If you look at what the Ute/Buyer is getting:
1.5 mil lbs (at a min of $80) would be 120 mil. So for less than 10% of the total purchase price they can lock up some future supply. Since it's a restart and OP, should be far less risk.
Will be interesting to read what UI and others say about this. Let me know if you listen to the CC if I'm on the mark or not.
This is not just good news for Lotus it's really the entire sector to a degree showing this model works. They still need to strike a 2nd agreement on similiar if not better terms, but shorts really playing w/fire here. |
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| From: ItsAllCyclical | 9/4/2024 12:18:48 AM | | | | | | LOT now at the lows, down 10% for the day. If it finishes here or lower I'm convinced we still have dumb money to flush and/or shorts that are piling on. Either way I'm fine taking the other side of these folks. 90% of investors just rely on price for whether the news is good or bad. Most will be too lazy to listen to the CC and think it through. Eventually the analyst will raise target prices, but they'll get their clients in first.
These offtake agreement (w/prepay) really are a win/win. The alternative is that you "hope" that you can get some supply?
Only 2 hrs left. Looks like a close on the lows in Aussie land is likely and a further washout tomorrow to test the Japan crash levels maybe tomorrow if some of this doesn't reverse. Will be watching to see if CCJ at least shows some leadership tomorrow or if the physical funds can diverge more. |
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